Ans.
NRI can open and hold
bank accounts in India with AD or AD Bank. The AD in India may accept deposits
from NRI under the following schemes:
i. Non-Resident
(External) Account Scheme (NRE A/c) in Indian Rupees
ii. Non-Resident
(Ordinary) Account Scheme (NRO A/c) in Indian Rupees
iii. Foreign
Currency (Non-Resident) Account Banks Scheme (FCNR (B) A/c) in Foreign Currency
iv. Special
Non-Resident Rupee Account (SNRR A/c) in Indian Rupees
Features of above schemes available to NRIs is tabulated below:
|
Particulars
(Refer Notes below)
|
FCNR A/c
|
NRE A/c
|
NRO A/c
|
SNRR A/c
|
|
Who
can open an account?
|
NRI
& Person of Indian Origin (PIO)
|
Any person resident outside India for
putting through bonafide transactions in rupees
|
Any
person resident outside India
who
has business interest in India for the purpose of putting through bonafide
transaction in rupees
|
|
Type
of Account
|
Term
Deposit only
|
Savings,
Current, Recurring, Fixed Deposit
|
Savings, Current, Recurring, Fixed Deposit
|
Current
(same nomenclature as specified business)
|
|
Repatriation
|
Freely
repatriable
|
Freely repatriable
|
Current
income is freely repatriable, provided all taxes are duly paid.
Other
balances in NRO A/c are remittable upto USD 1 million per FY, subject to payment
of applicable taxes.
|
Repatriable subject to payment of
applicable taxes
|
|
Taxability
of interest earned
|
Exempt under section 10(15)(iv) (fa) of the
Act
|
Exempt under section 10(4) of the Act
|
Taxable
|
Not an interest bearing account
|
|
Currency
|
Any permitted currency i.e. Foreign
Currency which is freely convertible
|
Indian
Rupees
|
|
Rate of
Interest
|
Rate
of interest are in the accordance with the directions issued by the RBI from
time to time
|
Not
an interest bearing account.
|
|
Change in residential status
|
Non-resident
to resident:
FCNR (B) deposits may be allowed to
continue till maturity at the contracted rate of interest, if so desired by
the account holder.
AD should convert the FCNR(B) deposits on
maturity into resident rupee deposit accounts or RFC A/c (if the depositor is
eligible to open RFC A/c), at the option of the account holder.
|
Non-resident
to resident:
NRE A/cs should be re-designated as
resident A/cs or the funds held in these accounts may be transferred to the
RFC A/cs (if the A/c holder is eligible to open RFC A/c), at the option of
the account holder immediately upon return of the account holder to India for
good. Where the account holder is only on a
short visit to India, the account may continue to be treated as NRE account
even during his stay in India
|
Non-resident
to resident:
NRO
A/cs may be designated as resident rupee A/cs upon return of the account holder
for good.
Resident
to Non-resident:
When
a resident Indian becomes a person resident outside India, his existing
resident account should be designated as NRO A/c.
|
Non-resident to resident:
SNRR
A/c may be designated as resident rupee A/c upon return of the account holder
to India for good.
|
Note 1: NRI means a person resident outside India
who is a citizen of India
Note 2: A
‘Person of Indian Origin (PIO)’ is a person resident outside India who is a
citizen of any country other than Bangladesh or Pakistan or such other country
as may be specified by the Central Government, satisfying the following
conditions:
a. Who was a citizen of India by virtue of the Constitution of
India or the Citizenship Act, 1955 (57 of 1955); or
b. Who belonged to a territory that became part of India after
the 15th day of August, 1947; or
c. Who is a child or a grandchild or a great grandchild of a
citizen of India or of a person referred to in clause (a) or (b); or
d. Who is a spouse of foreign origin of a citizen of India or
spouse of foreign origin of a person referred to in clause (a) or (b) or (c)
A PIO will include an ‘Overseas Citizen of India’ cardholder
within the meaning of Section 7(A) of the Citizenship Act, 1955. Such an OCI
Card holder should also be a person resident outside India.
Note 3: Opening
of accounts by Pakistan and Bangladesh nationals and entities incorporated in
Pakistan and Bangladesh shall require prior approval of RBI, subject to certain
exceptional cases (Refer FAQ 2 below)
Note 4: The tenure of SNRR account
shall be concurrent to tenure of the business operation and in no case, it
shall exceed 7 years (subject to certain exceptions as mentioned in FAQ 18 and
19). Approval of RBI shall be obtained in cases requiring renewal.